New Delhi, October 7: Union Finance Minister Arun Jaitley in his presser after the 22nd GST Council meeting, in National Capital has announced GST relief for common man, small traders and exporters. Government has reduced Goods and Services Tax (GST) on a total of 27 commodities. All exporters would be provided e-wallets by April 2018 and tax refunds to exporters would be issued through cheques from Tuesday.
Jaitley said the Council approved quarterly filing of returns for businesses with turnover upto 1.5 crore rupees besides raising the threshold for composition scheme from 75 lakh rupees to one crore rupees.
“This is an interim arrangement. The long-term solution is to create an e-wallet for every exporter in which a notional amount would be credited as advance refund and through this the IGST or GST will be paid.”
FM Jaitley said big taxpayers, who contribute 94-95 per cent of the total taxes, will continue to file monthly returns and pay taxes on a monthly basis. For the remainder of the fiscal, they will operate under an exempted category paying a nominal 0.1 percent GST, he said, adding from April 1 attempt would be made to launch an e-wallet facility for the exporters to provide liquidity.
The Union Minister further noted that the council also decided to cut GST rate on 27 common use items including Khakhra, plain chapati, food packets used in ICDS scheme and unbranded Namkeen will now be taxed at 5 percent instead of 18 percent. GST rate on unbranded medicines have also been reduced to 12 percent to 5 percent. Tax on parts of diesel engine has been reduced from 28 to 18 percent. To contain the cost of irrigation schemes involving high amount of labour, GST rate has been brought down to 5 percent.
Prime Minister Narendra Modi said that the GST has become even simpler after GST Council's recommendations and that it is in line with the government's constant endeavour to safeguard citizens' interests and ensure that India's economy grows.
PM Modi congratulated Finance Minister Arun Jaitley and his team for engaging with various stakeholders for extensive feedback which led to yesterday's recommendations. In a series of tweets, the Prime Minister said the composition scheme has been made more attractive and other facilitation measures will make the GST even more people-friendly and effective.
CII Director General Chandrajit Banerjee said that the Small and Medium Enterprises sector compliance will greatly improve as the limit for the composition scheme has been increased to 1 crore rupees. Federation of Indian Export Organisations (FIEO) also hailed the GST Council's initiatives, including the introduction of e-wallet. FIEO President Ganesh Kumar Gupta said the initiatives will address the problem of the exporters particularly micro and small segments.